Martha Stewart Living Omnimedia (NYSE: MSO) and Meredith Corporation (NYSE:MDP) are both cyclical consumer goods & services companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, dividends, valuation, analyst recommendations, profitabiliy and earnings.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Martha Stewart Living Omnimedia and Meredith Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Martha Stewart Living Omnimedia 0 0 0 0 N/A
Meredith Corporation 0 2 2 0 2.50

Meredith Corporation has a consensus target price of $62.33, suggesting a potential upside of 4.76%. Given Meredith Corporation’s higher possible upside, analysts clearly believe Meredith Corporation is more favorable than Martha Stewart Living Omnimedia.

Valuation and Earnings

This table compares Martha Stewart Living Omnimedia and Meredith Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Martha Stewart Living Omnimedia N/A N/A N/A N/A N/A
Meredith Corporation $1.70 billion 1.56 $357.73 million $1.17 50.85

Meredith Corporation has higher revenue and earnings than Martha Stewart Living Omnimedia.

Institutional & Insider Ownership

98.3% of Meredith Corporation shares are held by institutional investors. 12.4% of Meredith Corporation shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Martha Stewart Living Omnimedia and Meredith Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Martha Stewart Living Omnimedia -8.47% -9.42% -5.83%
Meredith Corporation 3.23% 19.44% 6.85%

Dividends

Meredith Corporation pays an annual dividend of $2.08 per share and has a dividend yield of 3.5%. Martha Stewart Living Omnimedia does not pay a dividend. Meredith Corporation pays out 177.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Meredith Corporation has raised its dividend for 4 consecutive years.

Summary

Meredith Corporation beats Martha Stewart Living Omnimedia on 10 of the 11 factors compared between the two stocks.

Martha Stewart Living Omnimedia Company Profile

Martha Stewart Living Omnimedia, Inc. is a global lifestyle company. The Company operates in three segments: Publishing, Merchandising and Broadcasting. The Publishing segment primarily consists of the Company’s operations related to its magazines and books, as well as its digital operations, which includes the Website, marthastewart.com. The Merchandising segment primarily consists of the Company’s operations related to the design and branding of merchandise and related collateral and packaging materials that are distributed by its retail and manufacturing partners. The Merchandising segment also includes the licensing of talent services for television programming. The Broadcasting segment consists of the Company’s limited television operations and its satellite radio operations. Its Website includes Martha Stewart Living, Martha Stewart Collection, Martha Stewart Pets, Martha Stewart Crafts, Martha Stewart Weddings, Everyday Food and Emeril.

Meredith Corporation Company Profile

Meredith Corporation is a diversified media company. The Company is focused primarily on the home and family marketplace. The Company operates through two segments: Local Media and National Media. As of June 30, 2016, the Company’s Local Media segment includes 16 owned television stations, one managed television station and related digital and mobile media operations. Its National Media segment includes magazine publishing, custom content and customer relationship marketing, digital and mobile media, brand licensing, database-related activities, and other related operations. Its National Media segment focuses on the food, home, parenthood, and health markets and is a publisher of magazines serving women. As of June 30, 2016, the Company’s owned television stations consist of seven CBS affiliates, five FOX affiliates, two MyNetworkTV affiliates, one NBC affiliate, one ABC affiliate and one independent station. The National Media segment also focuses on run-of-press display advertising.

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